Chinese giants invest in Singulariteam's $100m fund

Moshe Hogeg

Tencent and Renren are leading the investment in Moshe Hogegs second investment fund.

Chinese Internet giants Tencent Holding Group and Renren are leading investment in Moshe Hogegs Singulariteaminvestment groups, second fund, of $100 million. Singulariteam chairman and YO! and Mobli founder Moshe Hogeg launched the fund at a press conference today. Kazakh businessman Kenges Rakishev, who made most of his fortune in traditional industries, participated in the first Singulariteam fund, and invested directly in Mobli, is also an investor in the new fund.

Chinas Tencent is behind a number of leading services, including the instant messaging app WeChat. Tencent has a market cap of $200 billion, is the second in size in China (after Alibaba) and is one of the worlds biggest companies. Renren is the company behind the Chinese Facebook, and has a market cap of $900 million. Hogeg explained that the Chinese investments in the fund will make it possible for the companies in the investment funds portfolio to enter the Chinese Internet and digital markets more easily. With regards to Rakishev, Hogeg said, Unlike the previous fund, which Rakishev led, this time, he is still a significant investor, but not a leading one.

When we launched the first fund, we decided to bring a new methodology, where we serve as half angel investor, and half investment fund. We invest in the very early idea stages, but instead of investing $100,000, we invest $1-2 million at the idea and presentation stage, Hogeg explained. Its unusual, but, if I may quote Warren Buffett, If you believe in something, go after it aggressively, and dont leave it alone. In our world, investing $1-2 million in initial stages is going after it aggressively. It increases the likelihood of success of the companies that we invest in significantly. There is a difference between a CEO who is worried about how to pay salaries tomorrow morning, and a CEO who has money in the bank and is focused on building the product and creating value, Hogeg added.

Hogeg said that the new fund has already invested $20 million in start-ups, and the second funds portfolio already includes two companies that are developing mail apps - TL;DR, and Hop, alongside web-building platform Webydo, invest.com, Genesort, and the.net.

As far as Hogeg and Singulariteam are concerned, this is a significant step up, as the first fund was for only$20 million. Additional investors participated in the first fund, with a co-invest model, and added another $80 million. Hogeg said that the start-ups that the company invested in with the first fund raised a total $300 million. One of these companies was Mobli, the social-network app for photos and videos where Hogeg is CEO, which raised $86 million. Another is StoreDot, which is developing a fast smartphone charger, and which raised $32 million. Some other noteworthy companies in the portfolio are Meta and InfinityAR, which are developing special augmented-reality glasses, and YO!, which has developed a communication app where a single word is sent to users. Hogeg emphasized the difference between the investment fund he heads and other investment funds, and said, We connect between companies, so the synergy between companies and CEOs, product managers, and marketing managers help the portfolios entire eco-system. Hogeg also said that he brought on academics from the fields of behavioral psychology, marketing, and trends, in order to streamline the funds and the start-ups work processes.

Hogeg was asked about a few notable figures that were missing from the launch of Singulariteams second investment fund, after having played significant roles in the launch of the first fund. One such figure is former Prime Minister Ehud Olmert, who was chairman of the first fund. In a joint consultation between the two parties, we decided that Olmert is busy with other things today, and he is not continuing with us, Hogeg explained. (Olmert is currently busy appealing the six years prison sentence he received on a corruption conviction.) Another notable missing figure is Adi Sheleg, who managed the first fund, and is today a state witness in the Nochi Danker fraud case. The new fund is five times as big as the first fund, which Adi managed. The moment it became more significant, I took charge of the wheel, and Adi is leading the funds business development, said Hogeg.

Hogeg also announced that the fund intends to rent a 9,000 square meter structure, where most of the companies in the funds portfolio will be housed, in order to unite everyone under the same roof to enrich each other during development processes. The fund also announced a design challenge where it will be possible to win one of four prizes, for a total of NIS 100,000, to design innovative user interfaces in the fields of finance, e-mail, browsers, and news.

Published by Globes [online], Israel business news - www.globes-online.com - on January 28, 2015

Copyright of Globes Publisher Itonut (1983) Ltd. 2015

 
Moshe Hogeg
Moshe Hogeg
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